Nigeria: New Revenue Formula - Niger Delta Demands 50 Percent Derivation

Daily Trust (Abuja)
BY CHRIS EZE
Yenagoa — States in the Niger Delta region have demanded upward review of the current 13% derivation paid to oil producing states to 50%.
This was the high point of their presentation yesterday to the Revenue Mobilization Allocation and Fiscal Commission (RMAFC) in Yenagoa, Bayelsa State, as the commission rounded off its zonal public hearing on the best way to share the nation's revenues among the three tiers of government.
If approved, revenues accruing to oil producing states of Akwa Ibom, Bayelsa, Rivers, Edo, Abia, Delta, Ondo, Imo and Anambra which joined the league recently will multiply by close to 300 per cent.
With the existing 13% derivation, the abrogation of the onshore/offshore dichotomy during the Obasanjo regime had created a wide gap in revenues between oil producing and non-oil producing states.
Many states in the later group complained that they have been impoverished by the legislation.
In addition, the Niger Delta zone is pushing for the establishment of the 'Petroleum Host Community Fund' in section 116 of the proposed Petroleum Industry Bill which is before the National Assembly. This was emphasised at the public hearing yesterday.
Other geopolitical zones had during their public hearing rejected any further increase in the percentage of derivation accruing to the oil producing states.
Regions of the north particularly called for a legislation to restore the onshore/offshore dichotomy in revenue sharing.
During the Nort west public in Kaduna, states in the zone said they did not support any further increase on the 13% derivation, and called for a legislation to restore abrogated the onshore/offshore dichotomy.
Stakeholders in the zone said they believed that the Niger Delta states have been fairly compensated through the 13% derivation, the Niger Delta Development Commission, Amnesty Programme, the Niger Delta Ministry and increased budgetary allocations to the Niger Delta under the present Administration.
However, some Niger Delta leaders immediately criticized the submission by the North West which opposed additional revenue to the region beyond the 13% derivation.

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